Positioning, in business, is the decision about which clients, which problems and which competitors a firm wants to be compared with, stated plainly enough that a buyer can categorise (categorize, in the US spelling) it in one sentence. April Dunford’s definition, that positioning sets the context a buyer uses to understand what you sell, is the best general one I know, and it is hers. For a services firm the quickest working method is negation: decide what you are not, write it down, and publish it where the people you want to be compared with will read it. The rest of this page is that method and the story of using it.
Why positioning is harder for a services firm
A product company positions a product. A services firm positions people, and people can do almost anything a client asks. That is the trap. Every enquiry looks like billable work, every billable day pays this month’s payroll, and after two years the firm has done thirty different kinds of job for thirty different kinds of client and can describe itself only as “we help businesses with technology”. A buyer cannot place that in a sentence, so they do not, and the founder sells every deal from scratch.
Positioning is the decision that stops this, and it is a decision that costs money in the short run because it means declining work. That is why it is easier to take before the company exists, when there is no revenue to protect, and why it is worth revisiting every time the firm feels busy and directionless at the same time.
Positioning by negation: the method
Stating what you are is hard, because every honest description of a young services firm sounds like every other one. Stating what you are not is easier, sharper and more useful to a buyer. The method, in order:
- List the firms a buyer would confuse you with. Body shops, generalist consultancies, resellers, the big four, freelancers, an offshore team. Be specific about the type, not the name.
- Write one sentence per type saying why you are not that. “We are not a body shop: we take responsibility for the outcome, not for supplying a person.” “We are not a reseller: we do not earn margin on anyone’s licences.” Each sentence should cost you something. If it excludes no work you would otherwise take, it is not positioning.
- Find the argument underneath. The negations usually point at one belief about how the work should be done. That belief is the position. Ours, in 2013, was that the category everyone was talking about was not a tool you could buy or a team you could hire, and that most of what was being sold under its name was neither.
- Turn the belief into an offer a buyer can accept. The negations say who not to call. The offer says what happens when they do: the first engagement, its scope, what it costs.
- Publish it. A blog post, an article in a trade publication, a talk. Not a positioning statement in a deck. It has to be somewhere the people you want to be compared with will read it and can answer.
- Repeat it in everything. The rate card, the proposals, the job adverts. Positioning that appears only on the About page is a tagline.
- Keep the list of what you are not, and add to it. It becomes the firm’s stop-doing list, and it is the most useful document a founder at the ceiling can reread.
The two-week test: publish before you incorporate
In early 2013, weeks before we had a company number, Steve and I published an article arguing what our category was not. We had a point of view and no customers, and the article was the only asset we owned. Looking back, the test it passed was simple: within two weeks, competent people disagreed in public. If nobody had, the position would have been either obvious or invisible and would have needed sharpening. Because the right people argued with it, we had found the conversation our firm belonged in.
The article gave two employed practitioners a way into an industry conversation we had no standing in, and the argument in it was the one we made in sales conversations for years afterwards. As a method the test costs nothing and takes a fortnight, and in hindsight it was the best piece of market research we did before we had a company. The consulting niche playbook sets it out step by step.
What happened later: the word in our name
Positioning is not done once. We named the business after the idea in our argument, and for years led every sales conversation with that word. Customers did not buy the word; they bought getting to the cloud and keeping their systems running afterwards. So we stopped leading with the name of the idea and led with what they were buying. Around the same time we cut the service catalogue from everything we could do, to six offers, and then to three. Every item we removed had a case for staying. The removals were the positioning. The stop-doing list playbook is the method for making those cuts when the firm already has revenue to protect, which is harder than making them in a blog post at the start.
A consultancy, an agency and an MSP each need this decision, and each will find that the negations come faster than the affirmations. Start with the negations.